The confidence in the Swiss economy has significantly declined among financial analysts, according to recent surveys.
The economic outlook index, which is a collaboration between UBS and CFA Society Switzerland, reached its lowest point of the year in December, registering at -20.0. This marks a 7.6-point drop from November and represents the seventh consecutive decline.
The survey results show that there is a divide in expectations for the Swiss economy over the next six months. Only 14.3 percent of respondents anticipate an improvement, while 34.3 percent foresee a worsening situation. The majority, at 51.4 percent, believe the economic landscape will remain unchanged. Pessimism has increased, with those predicting a decline rising by 3.1 points compared to the previous month, while optimists decreased by 4.5 points.
Inflation remains a concern for analysts, with 17.1 percent of respondents expecting an increase, 45.7 percent predicting a decline, and 37.1 percent foreseeing stability. Regarding interest rates, 91.3 percent of analysts anticipate a contraction in the short term. In the long term, opinions are more varied, with 41.2 percent expecting no change and 30.2 percent betting on further reductions.
Looking at the stock market, 48.5 percent of respondents expect an increase in the Swiss stock market index (SMI) over the next six months, while 24.2 percent predict a contraction. On the currency front, 63.6 percent of analysts foresee a strengthening of the Swiss franc against the euro.
In terms of employment, 48.5 percent of analysts predict a rise in unemployment, while 51.5 percent expect stagnation.
Overall, the survey results highlight a growing sense of caution among the Swiss financial community. The shift in sentiment, particularly regarding inflation and employment, reflects the complexities facing the Swiss economy as it deals with domestic and international pressures.